Hearsay Social wants to give financial advisors a leg up on automated rivals

Social media management company Hearsay Social has released a new platform it says could keep the financial advisor from going the way of the dodo — or the travel agent.

The service, which launched on Thursday, is called Hearsay Social’s Predictive Social Suite. It will allow the company to move beyond collecting data from the social media feeds of its clients’ customers and start to perform analysis of how people engage with financial services providers’ websites. The idea is fairly simple: if financial advisors know a bit more about how their customers are using their websites, they might have a better idea of what they are looking for and what they should offer them.

San Francisco-based Hearsay works with several clients in the financial advisory world, which is currently facing increasingly stiff competition from a growing wave of digital financial advisors offering cheaper services to customers. Typically, these so-called “robo-advice” websites use questionnaires to create a personalized investment strategy for each customers after gauging such factors as their stated investment goals and appetite for risk. To respond to the automated onslaught, some of Hearsay Social’s finance clients approached the company to find a better way to compete.

In response, Hearsay’s new platform predicts customer behavior by monitoring activity on clients’ websites as well as their social media networks. That way, Hearsay CEO Clara Shih told Fortune, financial advisors can both take advantage of the improved efficiency provided by automation and algorithms while still being “able to add their unique human value, the human touch.”

To Shih, the financial services industry is “one of the key battlegrounds” in the debate over automation and its effect on the workforce. She draws a comparison to travel agents, an industry hit hard since the introduction of online booking websites, starting with Travelocity, which is now owned by Expedia.

Hearsay Social’s financial advisor clients — which include AXA US, Raymond James Financial RJF, and Vanguard — use the company’s existing platform to cull through all of the social media content posted by their online connections to find useful bits of customer information. “If you were my financial advisor and you were using Hearsay, you might pick up through your Hearsay Social signals that I just changed jobs. In which case, you’d probably want to talk to me about a 401k rollover,” Shih said.

However, no matter how many major life events end up being shared online, Hearsay Social’s clients felt they could not effectively compete with the automated advisor services by relying on information from social media alone. With the company’s new platform, Shih said, Hearsay’s clients can continue to access data from social media but they will also be alerted when visitors arrive on their websites and which products or services they seem most interested in based on their how they engage with the site. The information will help these companies’ advisors and relationship managers know when and how to reach out to customers and offer their services.

Shih, who also sits on the board of directors at Starbucks SBUX, cofounded Hearsay in 2009. The company has since raised $51 million from investors including venture capital firm Sequoia Capital over three funding rounds.

Digital financial advice websites have grown in popularity in recent years by offering the average consumer a more affordable, accessible way of obtaining investment advice. Robo-advice services like Betterment, Wealthfront, and Personal Capital raised a total of $290 million in venture capital funding last year, with Betterment adding $60 million from a group led by private equity firm Francisco Partners just this week.

Meanwhile, big financial institutions are also getting in on the act. Charles Schwab is set to launch its own robo-advice platform, Schwab Intelligent Portfolios, early this year. A robo-advice platform operated by Charles Schwab, or other traditional advisors, is likely to help those banks reach younger customers looking for less expensive investment advice, which is most likely the same demographic Hearsay Social’s platform would help its clients target, Morningstar analyst Michael Wong tells Fortune.

But while Hearsay Social might help its clients target a new customer base, that doesn’t necessarily help these traditional players compete against the upstarts on cost. “It does nothing to quell any type of concerns about whether younger audiences, and more tech-savvy audiences, will find value in paying a lower fee for a very basic and straightforward asset allocation plan of certain robo-advisors,” Wong says.

For her part, Shih argues that consumers will be willing to pay a premium for more personal service.

“When it comes to financial advice, and someone who really understands your situation … I would submit that the vast majority of investors, not just the wealthy ones … would rather have better advice than to go with the lowest-cost provider every time,” Shih said.

‘Hi, we’re Volvo. Remember us?’

For automobile enthusiasts of a certain age, a first glance at the grille and flowing lines of a 2015 Volvo XC90 luxury sport utility may evoke vague, pleasant recollections of a classic sports car from the 1960s, the Volvo P1800.

In an era when Scandinavian furniture was all the rage, the P1800 came to epitomize Swedish automotive design.

The P1800 sports coupe helped to usher in a parade of Volvo models in the U.S., sedans known for safety, practicality and ruggedness. The brand gained worldwide renown, attracting the Ford Motor Co. F to acquire Volvo Cars in 2000 for $6.45 billion. Fallout from the global financial crisis forced Ford’s sale of Volvo to the Geeley Group of China for $1.8 billion.

Five years after Geeley’s purchase, the XC90 today represents Volvo’s determination to recapture the brand’s American mojo, where its roughly 300 retail dealers have been nearly despondent as they wait for new models. Consumers seeking a rugged, sensible car from abroad increasingly have chosen Subarus, which (incredibly) today outsell Volvo 10-to-1 in the U.S.

Last year, U.S. sales were about 57,000 units, down almost 8% from a year earlier in a market that was up nearly 6% from 2013. At its peak in 2004, the company sold about 139,000 cars in the U.S. By 2020, Volvo hopes to sell 800,000 cars globally, compared with 466,000 last year, a record high driven by sales in China.

“A lot of people grew up in Volvos. We’re not a damaged brand,” said Bodil Erikson, a Swede who is chief marketing officer in the U.S. “We’ve fallen out of mind.”

Geeley, a maker of cars and other goods, has put its financial muscle behind an $11 billion capital program to launch a new era of vehicles, starting with the large SUV built on an architecture it calls SPA, which stands for scalable product architecture.

The first generation XC90, introduced in 2002, was a phenomenal success story for Volvo. Ford, in fact, admired the vehicle’s engineering so much that it borrowed XC90’s mechanical underpinnings to create its Taurus large sedan, which uses Volvo-designed innards to this day.

The new XC90 was designed to convey “Scandinavian authority” and “understated confidence,” according to its chief designer Tisha Johnson. The selection of materials and the shaping of surfaces throughout the car were inspired by objects like the Wegner lounge chair and Orrefors crystal vases.

In three versions, starting in price at about $49,000 and ranging up to about $55,000, XC90 will contend against large luxury SUVs like the Audi Q7, BMW X5, Acura MDX, Mercedes-Benz M Class and Infiniti QX60.

Volvo executives report the automaker will replace seven of its sedans, station wagons and crossovers during the next four years, a promise that should warm the hearts of its dealers.

Because the Volvo brand has shrunk in size over the last decade, it can’t match competitors with advertising buys such as a multi-million dollar commercial during the Super Bowl. Grey Group, its agency, instead devised a guerilla Twitter campaign during this year’s game and another tied to Sunday’s Academy Awards ceremony. More advertising will come toward summer, when the cars arrive at dealerships.

The automaker’s Chinese owners are staying quietly in the background, at least for the moment, allowing Volvo’s Swedish heritage and image to shine.

You can’t say no to Citi’s robo-clickbait

In the annals of marketing, no anti-littering slogan has ever held more swagger or sway than “Don’t mess with Texas.” Appealing to an audience’s emotions works: In the decade or so after that campaign appeared, stray trash plummeted statewide.

Now imagine if salesmen had that power of persuasion—or better yet, robot salesmen. That’s the kind of manipulative mastery Citibank is employing in its marketing departments in an attempt to boost the success of its promotional emails. Citi’s marketing missives use natural-language processing—a blend of artificial intelligence and linguistics—to generate sentences and phrases that customers can’t help clicking. The idea is to trigger an emotional response (and index-finger twitch) that might translate into sales. “It eliminates the guesswork of copywriting,” says Alex Vratskides, CEO of Persado, the startup behind the tech.

Three-year-old Persado says it has distilled the spectrum of human emotion into 19 categories—such as gratitude, fear, and love—all for the purpose of calling customers to action. The company says it has tens of millions of ways of phrasing email subject lines and has identified, for instance, 250 different ways to say “Call now.” By generating all possible word combinations in a given semantic space and testing a subset, it’s able to deploy the one that best rouses a response. The dispatches, though coolly calculated, tug consumers at their core.

“It’s like generating the most beautiful woman from the best possible genes,” says Vratskides, grinning. “Think of these as genetically engineered marketing messages.”

Citi, for one, has lots of reasons for employing machine-learning technology in its communications: to sell credit cards, to persuade customers to upgrade or open new checking accounts, to coax people into spending rewards points. If it’s going to contact customers anyway, why not tailor the messages to be as engaging as possible?

Persado says Citi has seen a 70% increase in the “open rate” of its emails and a 114% increase for the “click-through rate” within them. (Though Citi acknowledged that it uses the technology, it declined further comment.) The bank seems to have had such success with the software that Citi Ventures, its investment arm, participated in Persado’s second round of funding along with American Express Ventures and Bain Capital Ventures. It totaled $21 million.

And what would robo-marketers make of “Don’t mess with Texas”? David Atlas, a Persado marketer, can’t resist a rhyme: “We call this persuasion automation.”

Darrelle Revis: Richard Sherman made NFL defenders more marketable

Hand it to the folks at Steaz, an organic iced tea, for savvy timing with its latest sports endorsement deal.

The brand announced that it had signed New England Patriots cornerback Darrelle Revis as a new “brand ambassador” on January 17, the day before the Patriots played in the AFC Championship Game against the Indianapolis Colts. The Patriots, with Revis on the field, went on to win that football game and also win, in suspenseful fashion, Super Bowl XLIX against the Seattle Seahawks.

Revis made a name for himself during his time with the New York Jets, when he earned the nickname “Revis Island” for his ability to defend the endzone and keep opposing receivers from scoring. He is a big name in the National Football League—Nike NKE even makes the Zoom Revis, a football-inspired sneaker—but off the field, it has long been difficult for players in defensive positions to become highly marketable the way that a quarterback can. (With some exceptions: Green Bay Packers linebacker Clay Matthews and Houston Texans defensive end J.J. Watt have each appeared in television commercials and hawked various products.)

Now, a few weeks after his team’s big Super Bowl win, Revis took a moment to speak to Fortune about his deal with Steaz, how he approaches off-the-field deals in general, how his teammates approach them, and how much branding potential an NFL cornerback has these days.

What follows is an edited transcript.

Fortune: How did the Steaz deal come about?

Darrelle Revis: I’ve been drinking it for three years, in all honesty, and then one day I was just sitting there, and I thought, I should partner up with them. I made the call.

What other endorsements do you have and what’s your approach with things like this? Do you make as many deals as you can?

I’m a Nike athlete, and in the past I’ve been endorsed by Range Rover, and Bose right now. I think it’s about tying yourself to great organizations that believe in you. Organizations like Nike, that have respect.

Do you discuss endorsement deals with your teammates, or is that something everyone keeps to themselves?

Well, Tom [Brady] has a bunch of brands he’s attached to. I talk to him about that. It’s like, you get a package at your locker and everybody huddles around and wants to see what’s in the box. So I had a bunch of Steaz sent to me at my locker and everyone was asking about it, making jokes. You have to explain what it is, like, ‘Well, it’s green tea, it’s all natural, it tastes good…’ And my teammates, all the time, as soon as I get a package, they’re like, ‘gimme some of that.’

I just try to team up with brands when it’s organic and genuine. I grew up as a kid being a Nike fan. So whatever I believe in, I try to team up with those brands. Other companies have approached me, but it’s about teaming up with the right people.

Do you think often about your brand off the field, and try to expand it? Is there anyone in the league you ask for advice about how to do it?

That’s one of the biggest questions to look for a great answer on, from guys who’ve been there. Tom, he’s fifteen years in, he’s been at the top of his game for so many years, so having those guys in the locker room who’ve been there and done it is a good resource. Sitting down and talking to those guys, like Tom, or even just looking at them—Eli Manning or Drew Brees—at how they stay professional and how they carry themselves, you definitely take a look at what they’re doing, how they’re branding themselves and how they’re making money off the field.

You do have to brand yourself. And do it the right way. Those guys, straight down the line… Eli, Peyton Manning, Tom, Andrew Luck, Russell Wilson, [Colin] Kaepernick, they’re all doing it right.

But they’re all quarterbacks.

(He laughs.) That’s right. I’m a defensive player and I’m just trying to find my own way. Things are working well for me in a lot of ways. I’m not a quarterback, but I do look at those guys for ideas.

It’s always been hard for guys in defensive positions to establish big brands. But is the cornerback position getting more recognition lately? Richard Sherman, for example, you see all over television now.

Absolutely. Richard is one of the best in the league and he’s continued to make a name for himself, which is awesome. And we’re in the same position. We’re all DBs [defensive backs], and it’s a DB family. Richard is helping everybody out.

[Author’s note: On the field, the two certainly have a rivalry going. During this year’s Super Bowl, after a third-quarter Seahawks touchdown by Doug Baldwin, Richard Sherman appeared to taunt Revis by holding up a “24,” Revis’s jersey number, suggesting the touchdown was his fault.]

I do feel like after Deion [Sanders], there kind of was a drop-off for a long time. And then you have Champ Bailey come along, and Charles Woodson, and it really brought back that “shutdown corner” feel to the game. So you know, the guys in the league today, Richard Sherman, Patrick Peterson, Joe Haden… [Aqib] Talib… guys who are making a name for being shutdown corners, it’s pretty awesome. Everybody plays the game differently, but at the same time, overall, it’s shining a light on the DB group of guys and what we do every Sunday. It means more business opportunities.

As you build your brand more and get more visibility, are there risks of that spotlight? I’ve heard a lot of athletes talk about constantly being approached by old friends, or even family, looking for them to invest in their business idea.

The real world is pretty crazy. There are a lot of vultures out here and you have to be careful who you do business with. I’m a laid back guy, I’m easygoing, and I get approached all the time about business ideas or endorsements, but you have to weed out the bad ones and figure out what’s really genuine and organic for you. You just try to be careful. You have to know what’s a good deal and what’s a bad deal for you and go from there.

Do you think about life after football, and consider getting involved in business?

That’s always been up in the air. What do I want to do outside football? I’ve got a couple small business ventures already, but in general I look at people who’ve done it well, I look at Drew Brees, I look at the guys who are very successful on and off the field. I’m trying to follow the same lane.

How founders can tell a great startup story

In my role at Greylock Partners, I work closely with entrepreneurs to help them shape their company’s communications strategies. No matter the sector, I have found that the organizations who effectively tell their stories are the ones who can recruit the top talent, acquire long-term customers, and build brands that endure.

What is your story?

Your story is way more than a chronological history of your company. The biggest mistake most companies make is they start with the love story of the founders. (i.e. “My co-founder and I met when we worked together at Company X. We built these 3 successful products together and had had fun doing it, so we decided to build this new thing because we think there is a market for it.”) This is the absolute wrong foot to start on.

A great story about your company will succintly capture 1.) what you offer, 2.) to whom, and 3.) why you are different. Nailing this will set the path for every other decision you make going forward.

What you offer. This is a crisp and short description of the market need you are addressing.

To whom. Your customers need to be at the front and center in your story. You only exist because of them, and you were put on this planet to serve them. They are the true heroes of your story.

Why you are different. This is not a list of features. Why you are different should describe who you are as a team, what you value, and what you believe. The story about why you are different will influence your company culture, your ability to recruit and retain the right talent, the services and products your team will create, and how your team behaves over the long term. Which in turn will impact the way people talk about you when you aren’t in the room — people like reporters, customers, partners, and investors.

Who should tell your story?

Let’s first define who needs to hear your story. Most companies use the press as a starting point, but you are not crafting your story just for the media. You are also crafting your story for current and potential team members, customers, partners, and even competitors — basically everyone within your extended network needs to understand your story.

Dan Portillo, our Talent Partner at Greylock, often talks about how important it is for a CEO to tell a great story about her company when trying to recruit world-class teams. (Dan shared some of his ideas in this slide deck.)

Every team member should be a company storyteller. This recent column from Chris Kang at LinkedIn LNKD is a fantastic example. Chris is a strategic engagement advisor who wrote a detailed blog about the challenges they are tackling at LinkedIn, what it’s like to work there, and why she loves her job. She is not in the PR department; she’s an empowered LinkedIn team member who felt so much ownership about her company’s story that she was compelled to share it with her network. That’s the most powerful storytelling a company can have.

The key here is that it’s the same story inside and out. When employees are out and about with their friends, they should be telling the same story about your company that your PR team is telling the press.

On being human: A case study

Before joining Greylock, I ran communications for Hulu. One of the reasons I joined Hulu was because of a document called “What Defines Hulu” that was written by the founding team.

“What Defines Hulu” wasn’t just a bunch of bullet points about “company values” and a “mission statement,” which often come off as nothing more than sanitized corporate-speak. Instead, it included missives like:

“Our expectations are extremely high and we hold ourselves accountable. We all do the dirty work. No one in the company sees themselves above any task. We’ve all QA’d countless video thumbnails, including the regrettable 1992 season of Tequila & Bonetti.”

When I read the original “What Defines Hulu”, it felt like I had found my tribe — it was a maddening, dizzying freefall where I knew I had found my home. Isn’t that what all brand marketers want from their customers?

Because this story about Hulu was written with such clarity — the founding team precisely selected every word — the people who later joined Hulu really lived up to the document. We referred back to it often in meetings and at team lunches; it was a canon for how we should all behave.

But the most powerful thing about this document was that it encouraged prospective talent to self-select out of joining Hulu if they didn’t share connect with the story:

“There are a number of things that don’t matter to Hulu. Some of these things include: impressive titles, swanky office furniture, hierarchy, and nice lunches (Quizno’s and the local taco truck are our staples). Though most people profess not to care about these things, we’ve found that many people actually do care about these things. That is fine, but it also means that Hulu would be a very bad match for those same people.”

Because of this document, Hulu attracted and retained an extraordinary team of builders, and maintained a strong company culture as the team grew.

This document deeply influenced how I thought about communications. In the time I was with Hulu, we issued almost no press releases. All external communications were published via our blog — we spoke directly to our customers. In short, we were humans talking to other humans about the stuff that matters to each of us.

Now, I encourage Greylock portfolio companies to draft their own version of this document. In my case, I wrote a similar document when I joined Greylock, and it has since helped me direct all our own communications activities including press, design, events, and content.

Note to fellow marketing teams: Let’s stop polishing the heart out of everything. Find your true north star, write it down and let it guide the way.

Please note: The original “What Defines Hulu” has been dramatically edited in recent months. In this post, I am not referring to the current version on the Hulu.com website.

This is not your grandmother’s marketing world. There are more marketing methods than ever before. But there’s a major caveat to all this marketing commotion. So many of these marketing “hacks” and bold new moves could do the opposite of grow your business.

They could ruin your business.

Risky new moves put your painstakingly built business at the mercy of the elements. One wrong move, and you’re history. There’s also the cost risk, which is the biggest risk in my opinion. You must protect your marketing dollar and avoid squandering your pennies into dead-end methods.

So, how do you engage the potentially awesome techniques of modern marketing, but avoid the attendant risks? Here are a few important things that you’ll want to keep in mind.

Keep your goals front and center.

Every good business has goals — and not just the pie-in-the-sky goals of “get bigger” or “make more money.” The goals of worthy businesses are specific, measurable, attainable and timely. They also change often: Yearly, quarterly and strategically.

Goals keep a business on track. When the marketing winds change, and they will, all you need to do is look at your goals and ask, “Is this going to fulfill our goals right now, or will this simply distract us?”

Answer the question. Sometimes, you may need to go with your gut. Sometimes you may want to take a risk. But most of the time, you can play it safe. Your goals are important. Don’t sacrifice them.

It just doesn’t cost as much. That’s why it’s the method of choice for many startups. I suggest thinking about growth hacking in a simple way.

First ask, “How much does it cost?”

If it’s expensive, then avoid it, postpone it or make sure there is zero risk.

If it’s free or costs very little, then give it a try.

Here’s why I propose this simple method. Most often, the big-dollar marketing methods are not as effective for small businesses, businesses targeting millennials or businesses looking to grow in a postmodern market. The free or low-cost methods have their risk, too. The risks, at least from a financial standpoint, aren’t quite as risky.

Hire someone who is budget-conscious and ruthless.

Unless you’re totally solo in this entrepreneur thing then one of the most important people you can hire is a marketing professional.

Make sure you’re hiring for the right reasons. Whomever you hire must have a proven track record of growing businesses. But, equally important, look for these two qualities:

Budget-consciousness

Ruthlessness

The marketing leader must know that budget is important. This will force him or her to make moves that are strategic instead of haphazard. Ruthlessness doesn’t describe the personality as much as it does the determination to achieve goals.

When hiring a marketing professional, you can expect to pay him or her $40,000 to $65,000 per year, on average.

Make your customers your evangelists.

You can’t fail with turning your customers into evangelists. They will be more successful at marketing than you can ever dream of being, simply because they’re customers.

As you brainstorm growth hacking methods, don’t forget about this largely untapped source of marketing potential. As long as they are satisfied, your customers want to be evangelists. All it takes is a little nudge from you, and a few instructions on how to do it.

Evangelism takes many shapes and forms. Sometimes, it’s incentivized by compensating your customers with a free premium version of your product or service. But the most effective techniques happen spontaneously and eagerly. In which, if you make a great product, treat your customers right, and then give them a nudge, they’ll gladly evangelize your company for free.

Publish content.

Content marketing is one of the most effective means of growing a business in the modern information age.

Content marketing isn’t some novel technique anymore. Companies that don’t do content marketing are in the minority. In order to succeed at it, you have to work harder, publish better and get more strategic.

I often see companies bail on content marketing because, as they claim, it’s “not working.” Usually, the reason is because they haven’t been doing it long enough. Content marketing isn’t a quick dash. It’s a marathon marketing method.

There are ways to enhance the power of content marketing. The first way is by building an email list and harnessing the power of email marketing to enhance your published content.The second way is to use a variety of content forms. Hint: It can be more than a blog. Content marketing can include videos, forums, infographics, LinkedIn publishing, white papers, ebooks, etc.

Promote your personal brand.

The final, and perhaps most important method of keeping an opening marketing mind while protecting your business, is to promote your personal brand.

Businesses may fail, but you as an individual are going to stick around. You’re going to start more businesses. You’re going to do more stuff.

Your brand is more important than you realize. While you’re throwing your time and energy into the effort of building a new business, don’t neglect your personal brand. You can use your personal brand to grow your business, and your new business can help to grow your personal brand.

If your business fails, you’ll have your personal brand to fall back on.

Conclusion

Marketing is a fun and risky ride. There’s nothing quite like finding that sweet spot that starts delivering a steady torrent of visitors.

It can take you a while to find it or to build it. In the meantime, keep testing, keep exploring, but keep protecting your business. Keep an open mind, but protect what truly matters.

They’ve clearly spared no expense, with commercials during every other break and appearances from some of America’s most beloved characters—Dorothy and the Wicked Witch take a selfie, the Joker hands Batman a balloon animal, Super Mario offers a flower to the villainous Bowser, etc. And then the product push comes in: Freddy Krueger spears a handful of McNuggets for a hockey mask-clad Jason while a Packers fan hands a Bears fan a french fry. The message is that “Love is Endless” and the animation in the ads is quite beautiful.

Unfortunately, while it may temporarily juice store visits and “reposition the brand,” it does nothing to fix the underlying problems that have driven away the young parents and middle income millennials McDonald’s MCD has lost. These people are not coming back so long as their perception of the food quality is poor. Ads featuring SpongeBob aren’t going to cut it in the eyes of the modern consumer, who has unfettered access to nutrition data online and a consciousness about the production and retailing of the items they buy.

Frozen factory-produced meals are increasingly out of the question these days while being seen walking out of a McDonald’s has become socially unacceptable for a new generation of consumers. Last July, 30,000 consumers took part in a Consumer Reports study that ranked McDonald’s signature offering—the Big Mac—as America’s worst hamburger. McDonald’s placed 21st of 21, dead last behind burgers from Wendy’s, Burger King, White Castle, In-N-Out, Sonic, Five Guys, Jack In The Box, and every other chain you’ve ever heard of.

Against a backdrop of such devastating national perception of the company’s food, I’m not sure why an increase in ad spending would be considered a solution so long as McDonald’s products remain unchanged. Naturally produced food, sold in a more pleasant environment, is what people now demand—even if it costs more and has a higher calorie count than the old fast-food experience.

The good news for McDonald’s is that another company in its industry, Chipotle Mexican Grill, may offer a solution—but only if the incumbent is willing to be bold.

This past October, McDonald’s reported a 30% plunge in net income along with a sinking revenue line. Wall Street, which had not been expecting much from the report, was shocked nonetheless. The same day, Chipotle CMG reported a 31% increase in revenue along with an incredible 57% jump in profits. It’s almost impossible not to see the almost perfectly symmetrical negative correlation between the two firms. These reports represent a sort of gastronomic yin and yang.

Of course, the comparison is somewhat unfair, given that McDonald’s has a store count that’s almost 10 times that of Chipotle’s in the U.S. (14,000 versus 1,500). But customer losses for McDonald’s are customer gains for Chipotle. The irony in all of this is that McDonald’s was, at one point, the parent corporation of Chipotle and had shepherded the brand from 16 stores to 500. It divested itself of the red-hot “Fresh Mexican” concept in 2006 for a tidy profit of $1.5 billion. Fast-forward less than a decade later and Chipotle is worth more than $22 billion, having more than tripled its store count while doing over $1 billion in sales per quarter.

Just as McDonald’s is out tweaking its marketing message, using Pac-Man and the Smurfs to pump up the appeal of its brand, Chipotle is concerning itself with the integrity of its product.

Last week, at approximately one third of Chipotle’s stores around the world, a sign went up in the window that read, “Sorry, No Carnitas.” For the uninitiated, Carnitas is a filling for tacos and burritos comprised of pork shoulder that’s been braised and shredded, and it accounts for approximately 7% of Chipotle customers’ orders. The chain found out that one of its pork suppliers was not living up to Chipotle’s “Responsibly Raised” standards. There was no rationalization or “we’ll get ‘em next time” after-the-fact justification made by the company after learning of this slip. Instead, the offending product was removed from stores immediately.

Note that this was not sub-standard or tainted meat; it was simply not in compliance with the company’s promise to its customers.

While Chipotle may take a short-term financial hit on Wall Street for living up to its “Food With Integrity” mission, the longer term benefit should become apparent immediately to anyone paying attention to consumer tastes and trends. While the Golden Arches fiddles with its marketing in an attempt to bring back the eaters who’ve been turned off by its production methods, the managers at Chipotle are moving aggressively to safeguard the customer experience itself.

The contrast in words and deeds between these two companies could not be more stark. It should be obvious which one is going to win.

‘Trending’ software company Taykey raises $15 million

It’s easy to see what’s trending on the Internet, at least in a rudimentary fashion—just call up the top Google searches or glance at the trending topics feature on Twitter or Facebook. But there are many more indicators to use. Combined, they can more precisely identify a trend that’s sweeping the Internet and identify it long before it trends on Twitter.

Taykey, a New York startup that makes software for marketers, makes use of 50,000 inputs and 47 engineers with seven doctorates in natural language processing to build tools that surface trends. Inputs include anything from people “checking in” with Foursquare’s Swarm app to a widely popular weather event—Snowpocalypse 2014, anyone?—to a rush of edits on a particular Wikipedia entry.

For its first six years in business, Taykey’s business model has been to alert advertisers to trends occurring with their target audiences and automatically buy ad impressions next to trending content. For example, if a movie studio wants to target teenage girls who like music, Taykey would have told them last Monday that their target audience was talking about pop star Justin Bieber’s new Calvin Klein ad and instantly purchased ads on news stories, blog posts, and social content about the topic.

If you’re familiar with the story, you know what happened next. The next day the original, unedited version of the Bieber photo leaked showing that the photos had been modified to enhance his, ahem, bulge. Within 10 minutes Taykey’s algorithm picked up on the negative vibes around Bieber and pulled all the ads it was running alongside it. The company helps brands jump onto trends (and, if necessary, abandon them) automatically, targeted to specific audiences across many geographies.

Its strategy seems to be working. The 100-person company has “tens of millions” of dollars in revenue, CEO Amit Avner says, and counts brands such as AT&T, Verizon, Disney, P&G, MasterCard, Microsoft, Google, Starbucks, and Toyota among its clients.

Now Taykey is expanding its capabilities to do more than just buy ads alongside trending topics. The company is using its trend-spotting software to help brands create marketing campaigns that take into accound what’s hot with their target audience. Surely marketers for those brands were doing this before; Taykey’s algorithm is meant to infuse that process with more data in the form of a software platform. Taykey has already worked with brands including Red Bull and Volkswagen to use trending topics to alter their creative campaigns. General Electric has used Taykey’s new marketing platform to create blog posts on its sites that publish editorial content.

In addition to the expanded services it provides, Taykey has announced a $15 million round of venture funding from Innovation Endeavors, the venture capital fund of Google chairman Eric Schmidt, and existing investors SoftBank Capital, Sequoia Capital, Marker LLC, MSR Capital and Tenaya Capital. The company has raised a total of $32 million.

Will big data help end discrimination—or make it worse?

With only a tiny bit of data—the lowly ZIP code—it’s possible for marketers to infer a world of information about any given U.S. consumer.

With a ZIP code, a marketer can make a reasonable guess at a person’s income. With tools such as Prizm and Esri, they can probe deeper to determine education level and family composition, lifestyle and spending patterns, even hopes and dreams.

The rise of big data technology allows marketers to collect a tremendous amount of information about an individual with very little to start with. The challenge with having that kind of power? Keeping discrimination out of the picture.

“We use big data to create what we call propensity models,” says Jennifer Barrett Glasgow, chief privacy officer for Acxiom. “That’s where we’re trying to take a population and say, for example, are they more or less likely to be in the market for a new SUV?”

To an automotive company, a family with young children and a car that’s seven years old could be a good candidate. “It doesn’t take a rocket scientist to say that they’re probably looking for a new car,” Glasgow says. “We study the lifestyle and demographic data and rank order it, so when an SUV manufacturer wants to do a promotion, it’s one more piece of intelligence they can use.”

Acxiom ACXM has information about at least 95 percent of the U.S. population; the company typically has hundreds of data points on an individual. There is more data available than ever before, Glasgow says, and the modeling is getting far more sophisticated with improved accuracy and faster results. “More and more, the modeling and creation of new intelligence is being done in real time and on the fly,” she says. “It’s no longer static. In general, the velocity at which we can make and use predictions is really speeding up.”

For consumers, that means more relevant advertising and—in the big picture—continued free access to much of the Internet. “For individuals, big data is the tool that powers more personalized advertising and a free Internet,” says Mark Torrance, CTO of artificial intelligence-based media-buying platform Rocket Fuel, which claims tens of petabytes of anonymous consumer data. “It allows advertising to be more effective, delivering more relevant and interesting ads and offers to each person as compared with the random ads that would be shown online otherwise.”

But that granularity can cause significant repercussions. Case in point: A study published in early 2013 found that Google’s results for searches on “black-sounding” names—”Trevon Jones” was one example—were more likely to be accompanied by text suggesting that the person had an arrest record, regardless of whether he or she really did.

The American Civil Liberties Union is one of several consumer-protection organizations eager to make their voices heard. “One of the very tricky things about all this is that quite a lot of what’s happening is behind the scenes, at an algorithmic level, and it’s often proprietary,” ACLU attorney Rachel Goodman tells Fortune. “We know enough about what’s out there and the way the world has worked historically to really strongly suspect that [discrimination] is happening. Over and over in history, we’ve seen how credit and mortgage lending and other kinds of lending end up being apportioned unequally.”

Legislators have enacted regulations to try to keep things fair, particularly in housing (Fair Housing Act) and financial services (Equal Credit Opportunity Act). U.S. anti-discrimination law also prohibits the use of certain data known as “protected classes” as a means of discrimination. It’s not always that straightforward and marketers must walk a fine line. For example, ethnicity could be used for inclusionary purposes, Acxiom’s Glasgow says. “Maybe I have a financial product best-suited for that ethnicity, like a low-interest credit card that could help Hispanic kids in college,” she says. “That’s not discriminatory. It brings value to the person.”

It’s when marketers use ethnicity to keep attractive offers out of reach of certain population segments that it becomes discrimination. “It gets to be very subjective,” Glasgow adds.

A big part of what makes it so slippery is something known as a proxy, says Solon Barocas, a postdoctoral research associate at Princeton University’s Center for Information Technology Policy. The reason ZIP codes can be so useful for marketers is that they are proxies, or close representatives, of other factors and offer more insight than mere location.

Race is unfortunately one of those correlated factors, Barocas notes. By relying on a proxy like the ZIP code, marketers can end up discriminating racially—even if they don’t mean to. And removing the proxy from the model isn’t always an option. In real estate, for example, location is too essential a factor to eliminate from consideration.

It’s even more complicated online where the rules of the discrimination game are less apparent. “At least if you walk into a subprime lender in your segregated neighborhood, you have some information about who is being served,” the ACLU’s Goodman says. “Online, it’s all so hidden. I don’t think people think about it, and that makes the notion of predation so much easier.”

It doesn’t have to be like this. The Internet has long been viewed by some as the ideal place to remove many of the biases that plague human interactions offline. “That could be so tremendously powerful,” Goodman says. “The Internet could do that.”

Torrance agrees. “This technology can be used completely without regard to race, ethnicity, or other protected categories to identify people as good prospects on the basis of their online activity and behavior,” he says.

But that’s not what’s happening most of the time. The ACLU, for instance, has asked the Federal Trade Commission to investigate the issue. “We’ve already created all these institutions and systems to force best practices in banking and housing,” Goodman explains. “The entities that do that regulation need to consider how the existing law allows them to require that transparency online, especially in marketing.” Transparency is particularly important when it comes to marketers’ algorithms, she says.

Technology could also help. “If machine learning algorithms working on big data result in racial discrimination, then other algorithms can measure the effect of discrimination,” says Gregory Piatetsky-Shapiro, president and editor of KDnuggets.com, a website about data mining. “Once the effect has been measured, then society and government can decide if the discrimination is intentional or not, and what kind of compensation or remedial action can be taken.”

In the meantime, companies like Acxiom and Rocket Fuel FUEL have no choice but to tread carefully. “We have invested significantly in tools that give our customers insights into where, when, and to whom our machines are serving their ads so that they have a chance to give us feedback on what makes sense,” Torrance says.

For Acxiom’s part, the company says it limits how its data can be used. (It refuses to sell data to adult entertainment businesses, for example.) Internally, a training program sensitizes employees to the issues involved and regular privacy impact assessments keep things in line.

“The technology is moving so fast that we want people to stop and think, how would I feel if it was my data being used in that way?” Glasgow says. “Just because you can do it doesn’t mean that you should.”

Most energy drink companies market to minors, report finds

This post is in partnership with Time. The article below was originally published at Time.com

Alexandra Sifferlin, TIME

There’s no denying the energy drink industry is booming, with 60% growth between 2008 to 2012. But a new report from three U.S. senators raises questions about one particular segment of the market that’s growing: minors.

The report, titled “Buzz Kill,” is part of senators Edward J. Markey (D-Mass.), Dick Durbin (D-Ill.), and Richard Blumenthal (D-Conn.)’s ongoing investigation into the energy drink industry. Their primary concerns are lack of regulation by the U.S. Food and Drug Administration (FDA) over the drinks, which may pose health problems for kids, adolescents and teens.

In 2013, the three senators sent letters to 16 energy drink companies asking about their willingness to report any adverse reactions to their products as well as to voluntarily submit to restrictions against marketing to young people. In “Buzz Kills,” the senators report that just four of the 12 companies say they avoid marketing their energy drink to people under 18.

“Unfortunately, as long as early development of brand loyalty is seen as a competitive market advantage, energy drink companies will continue with the practice of marketing to teens in the absence of regulation that prohibits it,” the report reads.

The American Beverage Association has long offered guidance to the beverage industry on labeling, advisory statements, and marketing to children, recommending voluntary statements that the drinks are not recommended for kids and that the products not be promoted at K-12 schools. While several energy drink companies, including Red Bull and Monster, have made a commitment not to market to kids 12 and under, some critics say people over age 12 are still at risk for possible health consequences, like neurodevelopment interactions and heart-related effects.

In response to the report, American Beverage Association spokesperson Christopher Gindlesperger said this, in a statement:

“Energy drinks have been enjoyed safely by millions of people around the world for more than 25 years, and in the U.S. for more than 15 years. Energy drinks, their ingredients and labeling are regulated by the FDA, and, like most consumer products, their advertising is subject to oversight from the U.S. Federal Trade Commission.

This report ignores crucial data about energy drinks and caffeine consumption in the U.S. Based on the most recent government data reported in the journal Pediatrics, children under 12 have virtually no caffeine consumption from energy drinks. This study’s findings are consistent with an analysis commissioned by FDA and updated in 2012, as well as a published ILSI survey of more than 37,000 people which shows that caffeine consumption in the U.S. has remained stable during the most recent period analyzed, while coffee remains the primary source of caffeine in most age groups.

Leading energy drink manufacturers voluntarily go far beyond all federal requirements when it comes to labeling and education. In fact, ABA member companies voluntarily display total caffeine content – from all sources – on their packages along with advisory statements indicating that the product is not recommended for children, pregnant or nursing women and persons sensitive to caffeine. They also have voluntarily pledged not to market these products to children or sell them in K-12 schools.

Based on current regulations, the companies are not breaking rules. An FDA regulatory category for “energy drinks” does not exist, and companies can file their energy drinks to the FDA as either foods or dietary supplements. Some companies do not need to label the amount of caffeine in their products, and others are not required to report adverse health events linked to their products. Given the regulatory confusion, the report authors say the FDA and manufacturers need to make some changes for better transparency.

The senators call on the FDA to set a recommendation for the amount of caffeine a child or adolescent can safely consume each day. They also argue that all energy drink companies should commit to providing adverse-event reports to the FDA, and companies should stop promoting their beverages as “sports drinks.”